Tesla’s handling of the first fatality in one of its AutoPilot-equipped cars has been a major PR blunder.
While that is easy to say in hindsight, the proven response was established years ago when airline passenger plane crashes killed dozens and threatened the industry’s growth:
- Get the news out first.
- Kill speculation and rumors before they can take hold.
- Create trust by at least appearing to put truth, safety and human life ahead of profits and image and by actively and publicly working to root out and correct any glitch in your product or services.
Those airplane crashes involved loss of multiple lives, not just one. Yet, satisfied that the airline industry valued human life and was motivated to minimize risks, the public accepted the crashes as the inevitable price of progress and gradually took to winged mass transportation.
The public had no reason to mistrust Tesla’s and founder-guru Elon Musk’s trumpeting (pun intended if you see one) of the electronic future for autos with headline-grapping claims for its technology. Particularly when Tesla delivered a product that came close to his hyperbole.
Now, by delaying word of the fatality and issuing defensive news releases heavily slanted to rebuff criticism, the acceptance and trust in the product and confidence in Musk that was built despite anElon Musk average of $6.00 per car spent on advertising (as compared to the industry average of $1,000 per car) have been severely diminished.
Of course there may be other motives for Tesla to have ignored classic PR practice and wait nearly a month to address the crash. Fortune Magazine noted the fatal accident occurred just two days before Tesla and founder Elon Musk went to the capital markets with a new stock offering that raised a combined two billion dollars before investors knew of the fatality in a car equipped with the company’s much-ballyhooed Autopilot. The stock has not suffered since the ill-timed acknowledgment. Perhaps unchanged because investors are heartened by the “prophet of technology” putting profit first.
Tesla and Musk issued rebuttals to the Fortune article. But, the seeds of doubt and suspicion have been sown: the company has been found guilty of overstating mileage claims, an owner blogged his own failed tests of AutoPilot and other accidents involving Tesla cars have come to life: SEC and NASA investigations are in the offing, as is a Congressional inquiry while Consumer Reports wants AutoPilot off the road until it is failsafe.
Musk’s “Golden Boy” genius image and believability have been tarnished (AutoWeek used the word “crazy” in headlining a story about his future plans, another columnist suggested he believes his own publicity and sycophants). Tesla’s products, innovations and trustworthiness are now suspect.
Instead of leading the way to the future of autodom, Tesla and Musk are defending – and that may include in a courtroom where Musk’s character and marketing hyperbole will be challenged along with “being out their in Beta mode, relying on their customers to be guinea pigs,” as one consumer group spokesman said. Still, it may have been worth an extra billion or so.